Sunday, July 31, 2016

Staunton,
July 31 – Tatyana Nesterenko, Russia’s first deputy finance minister, says that
Russia is in the eye of an economic storm and that if there are no reforms in
the near term, the country will exhaust its reserve fund by the end of 2017, a
development that others like Igor Eidman suggest could point to the end of
Vladimir Putin’s vaunted “stabilization.”

Speaking at the Territory of Meaning
conference, the deputy minister said that the Russian economy is now “at the eye
of the storm” and that its current stability depends exclusively on reserves
which she says will be exhausted by “the end of 2017” (rbc.ru/economics/30/07/2016/579c6ede9a794749236f1d81?from=main).

“The eye of the storm is when
everything quiets down” for a time, leading some to conclude that they are not
surrounded by storms into which they will soon be buffeted.Unless there are serious reforms, Russia will
again enter those troubled waters – and it will then find it even more
difficult to address the problems given the absence of reserves.

How is Russia to get out of this? She
asked rhetorically. “Will this be something chaotic or will we form a policy
that will allow us in a less troubled way to escape from the situation?”Given that in a matter of months, the
government will not be able to pay those who work for it, this is now a
critical question.

That means that the stability on
which Vladimir Putin has built his authority is now in doubt, and according to
Russian commentator Igor Eidman, “ever more people believe that there is
[already] no stability in the country,” even though the country has the kind of
wealth that properly exploited should allow for that to continue (dw.com/p/1JWn0).

By 2013, the share of Russians who
believed that Russia had achieved stability and that Putin was responsible
reached its “historical maximum” of 40 percent, Eidman says.But with the annexation of Crimea, there was
a clear sense of “the beginning of the end of ‘Putin stability,’” he adds.

The euphoria over that event kept
Russians from immediately recognizing that they were going to face sanctions,
the growth of military spending, the outflow of capital, the collapse of the ruble,
and a general economic crisis. But with time, ever more Russians are
recognizing that new reality.

Today,
Russians talk about inflation, unemployment, the loss of hope and the fact that
even the government says “’there is no money,’” and according to the latest
Public Opinion Foundation survey, now only a quarter of the population believes
that the country is in a state of stability (fom.ru/TSennosti/12765).

“It
is interesting,” Eidman says, “that no seeing stability in the country, people
have begun ever more often to take note of stagnation” with more than 40
percent describing the situation with that term.“Many Russians,” he says, “view the current
situation as the absence of development with an intensification of general
instability.”

“The
overwhelming majority of respondents”in
the new poll, however, when asked to choose between stability and “’radical
reforms’” choose stability, although that doesn’t mean that “people are against
reforms” if they can see that without them, stagnation and decay will only
intensify.

Desire
for revolutionary change, something that no open poll now asks about, Eidman
points out, is probably about the same as it was at the end of 2012 when 13
percent of Russians said they felt Russianeeded a revolution (wciom.ru/index.php?id=236&uid=113319).

But “the loss of the population of a
sense of stability is [now] the most serious political problem the Kremlin
faces.” It could lead to a loss in support for the ruling party and even for
Putin, especially as people become more selective in their evaluations of why
the country is in the state it is now in.

But there is a clear and obvious problem:
“stability is impossible without a turning away from the foreign policy
adventures and extraordinary military expenditures which are destroying it and
from the repressive laws which are splitting society as are falsified
elections.” But such a change in overall policy is impossible for the current
elite.

Consequently, Eidman concludes, “reforms
for overcoming instability and stagnation could be popular in Russian society,”
but they could happen “only after radical political changes” that currently
seem less likely to occur. That points to growing economic problems and more
instability in the coming months.

Staunton, July 31 – Vladimir Putin’s
appointment of an admiral in place of a general as his plenipotentiary
representative in the North Caucasus may make things in that region still worse
but reflects Moscow’s concerns less about the situation there than the one in the
three countries to the South,according
to Maksim Shevchenko.

Putin’s decision to install Vice
Admiral Oleg Belaventsev in place of MVD Lt. Gen. Sergey Melikov as his man in the
North Caucasus is “symbolic” of Putin’s latest cadre decisions, which reflect
that it is traditionally easier for the Kremlin to establish relations with
military personnel rather than non-military officials, including those of the police.

Given Belaventsev’s success in
organizing the seizure of Ukraine’s Crimea, Shevchenko continues, it is clear
that he will be able to strengthen command and control in Russian forces in the
North Caucasus to deal with any challenges in the south.What is less clear from his past career is
whether he can make a positive difference in the North Caucasus itself.

In Crimea, he has shown himself “unable
to deal with local elites” or manage to jointly rule the peninsula with the civilian
authorities. Instead, his conflicts with them over the treatment of the Crimean
Tatars have become legendary as a mark of Moscow’s failure to integrate the
population there.

Of course, it is true, Shevchenko
says, that “the positions of presidential plenipotentiaries are quite weak.”
They do not have any real power, “not in terms of force structures, finances or
cadres. Instead, they are PR managers who present this or that region to the
rest of the country” as they assume Moscow wants it presented.

Under Melikhov, the required image
was of the North Caucasus as a tourist destination, one that was incompletely
achieved by the plenipotentiary and his staff seeking to “block any information
they deemed negative about what has really been going on in the Caucasus,”
including about ethnic conflicts, human rights violations, attacks on
journalists, and so on.

Journalists and editors were told to
write “only about the beauties of nature, the interesting traditions and
customs.” That not only obscured what in fact is occurring but ensured that
Moscow, by becoming a prisoner of its own propaganda, would not be aware of
just how bad things are, Shevchenko continues.

If this struggle with independent
journalists, experts and rights activists continues, he says, the situation
will only worsen as the gap between what is true on the ground and what is said
in the media and in government reports continues to grow. That is sustainable
for only so long.

Everyone knows how successful “the
special operation in the Crimea” was, Shevchenko says, but “here in the North
Caucasus are entirely different realities.” Unless the new plenipotentiary is
prepared to look them in the face and work with journalists and experts, he
will not know what is going on or what to do.

Worse perhaps, he will not know what
to tell Moscow which is now being misled by security people who want more money
for counterterrorism, by local oligarchs with their own agendas, and by his own
representative who is telling him that everything is wonderful and that
tourists should come to the unstable region.

Staunton, July 31 – The Kremlin is working
hard to expand its leverage against Moldova by expanding its ties with that
country’s Gagauz minority, offering the 200,000-strong southern region “the
opportunity for integration with the Russian Federation” directly thus “bypassing
Chisinau” and further weakening Moldovan statehood.

That is the judgment of Svetlana
Gamova, a “Nezavisimaya gazeta” journalist who specializes on Russia’s
relationship with the countries of the former Soviet space, on the basis of her
examination of recent developments in Moscow’s ties with Chisinau, on the one
hand, and with Komrat, on the other (ng.ru/cis/2016-07-28/1_gagauzy.html).

Last week, she reports, there was a
two-day meeting in Moscow between Russian and Moldovan officials to discuss the
lifting of the Russian blockade on Moldovan agricultural products that has been
in place since March 2014 in exchange for Chisinau’s ending its blockade of
Russian supplies to the breakaway Transdniestr region.

But as Gamova points out, there was “a
bonus” from these talks in that Irina Vlakh, the recently elected pro-Moscow
head of Gagauzia, took part and reached agreement with Moscow on allowing 43
firms from that region to again send their products to Russian markets. No such
opening was offered to other Moldovan firms.

This is a striking development
because talks between Moldova and Russia have bogged down over Moscow’s demand
that Chisinau denounce part of its association agreement with the European
Union, something the Moldovan government does not want to do, preferring
instead to develop relations with both Brussels and Moscow.

Moscow’s use of the agricultural
weapon against Chisinau both regarding Moldova as a whole and its special
approach to the Gagauz reflects the underlying reality that until 2014, Moldovan
farmers sent 93 percent of the apples they produced to Russia and 80 percent of
the plums.

Only by regaining that market,
Gamova suggests, can the Moldovan economy hope to survive. But by
discriminating in favor of the Gagauz at the expense of Chisinau, the Russian
government is simultaneously putting pressure on Moldova to cave and giving
Moldova and its supporters in Europe and the West new reason for concern.

For two decades, the Russian
government has sought to use the Gagauz as part of its Transdniestr strategy of
weakening Moldova and blocking its moves toward European integration. Last week’s
meetings in Moscow strongly suggest that the Kremlin is stepping up this
pressure by making ever greater use of Komrat against Chisinau.